Recent audits reveal how poor strategic planning leads to lost opportunities for governments that are looking for new ways to deliver services at the lowest cost possible.

In December 2013, San Diego's city auditor found the city offered too few of its services online, services that were available were difficult to locate, and the process for placing business services online was "decentralized, non-uniform and incomplete." Jessica Mulholland

State and local governments have made significant improvements in how they use the Web to serve citizens. The Center for Digital Government has been highlighting the best websites for 18 years and describes last year's winning sites as "first-class" in terms of service delivery, productivity and performance.

But some recent audits have revealed that many states and localities (along with the federal government) continue to struggle with how to build an online service that lets citizens and businesses transact with government in a simple and effective manner, and they lack a strategic plan for developing new services. The result can be confusion for many who want to interact with government online and lost opportunities for governments that are looking for new ways to deliver services at the lowest cost possible.

Strategic planning is a process that helps public officials determine the future direction for a department, agency or entire government. In practice in the public sector since the 1960s, strategic planning differs from other types of plans because it allows senior management to assess where their organization is now, what its future will be and how to get there by setting goals and objectives. As the use of information technology has surged in the face of a declining workforce, cities and states are starting to recognize the importance of including future online services in the strategic planning process. But the practice is far from universal.

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Two government website performance audits recently highlighted in Katherine Barrett and Richard Greene's B&G Report underscore the problems that can occur. Last December, San Diego's city auditor found the city offered too few of its services online. The auditor listed several city services, from construction permits and bids for city contracts to police record requests, business loan applications and special event permits, that should be online. Services were available were difficult to locate, and the process for placing business services online was "decentralized, non-uniform and incomplete."

Despite the fact that 1.2 million visitors come to the site each month, the auditor criticized the city for not having a "strategic direction or policy initiative for online service delivery." Without a formal process to identify and create new online services, San Diego has struggled to improve the effectiveness of city operations, warned the auditor. By incorporating web services into the city's strategic plan, San Diego's top management could give city departments clearly defined goals and objectives when it comes to developing and implementing online services.

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Lack of a strategic plan was also the problem with the under-performing online service for Michigan's business community. The "Business One Stop" system was designed to assist people who want to apply for licenses, permits and regulations that are required to start or operate a business in the state. The state's Office of the Auditor General assessed the system and found that the Department of Technology, Management and Budget had not developed a plan for the development of the one-stop online service, weakening the department's ability to ensure the service was both cost-beneficial could meet the needs of customers and the various agencies that interacted with the business community. The one-stop service has cost the state $21 million since it was built in 2007, and in 2012 it collected $7.2 million in revenue from licenses, permits and registrations.

Without a strategic plan, the auditor found that several agencies tasked with assisting businesses were not part of the system, leading potential customers to avoid using the service. Meanwhile, those that did use it found the service to be less than satisfactory.

The problem with strategic planning is not confined to state and local government websites. Last year, the Government Accountability Office (GAO) investigated the IRS's website, which had 375 million visits in 2012, making it one of the most active in government. Despite its traffic volume, the website offers limited online services and most of the site's 110,000 web pages are static. More importantly, the GAO reported the IRS had no long-term strategy for improving the website, and few details on goals for future online services, the kind of information that would be part of a good strategic plan.

The findings of the GAO are reflected in a recent survey that found customer satisfaction with federal government websites was on the decline, with the Department of Treasury (which includes the IRS) having one of the lowest scores, according to the American Customer Satisfaction Index. Why the federal sector is struggling with its website satisfaction isn't clear, but one of the reasons could be the lack of strategic planning.

For years, strategic planning has been getting a bad rap as an exercise that generates little attention. Yes, plans may help provide an organization with a new direction, only to end up being ignored as managers struggle to keep up with daily job pressures. But good plans can be a guide to making complex decisions, setting priorities and adopting standards against which progress and performance can be measured. A simple, high-level plan provides leaders with direction for change while empowering staff to implement new services.

The San Diego audit singled out three governments where strategic planning was the underpinning to highly successful online services. New York City's "Business Express, an interactive guide, has helped move new businesses through the startup process. The service fit with former Mayor Michael Bloomberg's initiative to create a one-stop business resource, and by involving multiple departments, the city's website was seamless from the user's perspective. Riverside, Calif., crafted a strategic plan for information technology that enabled the city to rollout an increasing number of self-service applications available online. By making the plan transparent and accessible, it became part of the city's commitment to making services useful to users while helping keep costs in check. In 2011, Louisville, Ky., launched a strategic plan that made online services a top priority. The plan set specific benchmarks, such as expanding the number of online services 15 percent annually. All three sites have received national recognition for their quality.

Despite the glimmers of good fiscal news, states and localities will face significant financial pressures to keep their books balanced for years to come, according to a report by the GAO. One tool for trimming costs is to shift more services online. But without the right kind of planning from the top, the transition to digital services will remain bumpy and fraught with failure, as these audits have shown. It's time for state and local governments to revisit the strategic plans and ensure they include Web services.

With more than 20 years of experience covering state and local government, Tod previously was the editor of Public CIO, e.Republic’s award-winning publication for information technology executives in the public sector. He is now a senior editor for Government Technology and a columnist at Governing magazine.